Television digest with electronics reports (Jan-Dec 1956)

Trade Report July 7, 1956 IS THERE A PLAGE FOR SMALL TV MAKER? Paul V. Galvin's recent prediction that mere 6 or 8 top manufacturers will survive when TV industry is finally "shaken down" has stirred up lively comment from all levels of the trade. Whether or not you agree with the veteran founder-president of Motorola, generally ranked as 4th largest TV manufacturer and very important also in auto radio, communications equipment and electronics production, there's no getting around the fact that the number of TV manufacturers has been reduced in last 6 years from 100 to about 50. Quite a few went out of TV business last year and during first half of 1956, and it would seem that prospects for many smaller manufacturers are anything but encouraging. Is TV therefore following pattern of auto industry, dominated by handful of industrial giants? And if so, what impact will it have on distributors and dealers? Finally, is there a pattern of survival at hand for the marginal TV producer? We checked several set makers, large and small, for reaction to the Galvin thesis — and found general agreement that the industry is certainly due for further attrition. Beyond that generalization, opinions varied. A few of the "very bigs" were inclined to agree with Galvin, but most said they thought his figures far too low, others felt them reasonable. Few wanted to be quoted on so touchy a subject. Many little-publicized set makers — depending largely on private-label trade — admitted that their future in TV is far less encouraging than, say, 3 years ago, but were optimistic about their chances of sticking it out, provided they can contain their TV production in a narrow range and not try to slug it out with majors. Most preferred not to be quoted, though their answers followed same general pattern. Trav-Ler Radio pres. Joe Friedman, typifying reaction of many, said the independent producer can stay in business and make a profit by keeping production costs low, making prices competitive and working more closely with key dealers on special market requirements. He stressed necessity of concentrating on efficient operations, reducing number of sets in line if necessary to cut down inventories. Several others added other angles. Said one; "The key to our survival lies in specialized selling. We are not in any sense competitors with big, full-line manufacturers." Said another: "We must produce something that need not meet a specific price range. Ours is a custom business designed to meet specific needs and we must keep it that way if we are to last in TV." Some of industry conditions unfavorable to smaller TV makers are self-evident. Trend to full-line production by big manufacturers, and the fierce competition which has resulted, has siphoned off best distributors in many markets, leaving very slim pickings for smaller manufacturers. There's increasing importance of brand names, as evidenced by fact that top 10 manufacturers account for estimated 80-85% of all sets produced. There's the high cost of a hard-hitting advertising program designed to keep brand names constantly before trade and public. And there's also the cost of keeping abreast of latest engineering developments. Note ; Fall-winter edition of our TV Factbook, due about Aug. 1, includes Directory of U.S. and Canadian TV manufacturers and assemblers, listing addresses, phone numbers, brands, executive personnel. We list 54 TV manufacturers in U.S., 20 in Canada. Among significant absentees from our last Factbook 6 months ago are Sentinel and Sparton, both bought by Magnavox; Raytheon TV-radio div., purchased by Admiral ; Stromberg-Carlson, which quit TV production. Only addition is Hotpoint. For first time, too, we list all foreign manufacturers and assemblers of TV receiving equipment — 248 in 15 countries. CRS-Golumbia Staius: There seems to be little doubt, though formal statement hasn't yet been issued, that CBS-Columbia is quitting TV-radio production — for all distributor franchises were cancelled this week, effective Aug. 2, all tools & dies * * * * 9